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Barnes & Noble’s Patent-Misuse Claim Against Microsoft Thrown Out by Judge

Barnes & Noble Inc.’s claim that Microsoft Corp. (MSFT) is misusing patents to undermine competition from Google Inc. (GOOG)’s Android operating system was thrown out by a U.S. trade judge.

U.S. International Trade Commission Judge Theodore Essex rejected today Barnes & Noble’s arguments the patents should be held unenforceable, Microsoft Deputy General Counsel David Howard said in a statement. Essex’s decision is subject to review by the six-member commission, which has the power to block imports of products that violate U.S. patent rights.

A trial on whether bookseller Barnes & Noble’s Nook e- reader infringed the four patents, and whether they are valid, is scheduled to begin Feb. 6 in Washington. Essex separately today declined to rule in Barnes & Noble’s favor on two of the four Microsoft patents, according to a posting on the agency’s website.

“Today’s action by the ITC makes clear that Barnes & Noble’s patent misuse defense was meritless,” Howard said in an e-mailed statement. “This case is only about one thing -- patent infringement by Barnes & Noble’s Android-based devices.”

The judge didn’t release a public version of his findings. Notice of the decision was reported earlier by the Fosspatent Web blog. Mary Ellen Keating, a spokeswoman for Barnes & Noble, said the company had no comment.

Licensing Accords

Microsoft, the world’s largest software maker, has said it reached licensing agreements with makers of more than 70 percent of the Android-based smartphones sold in the U.S. It got a mixed ruling at the ITC in a case against Motorola Mobility Holdings Inc., with Essex saying in December that only one of seven patents asserted by Redmond, Washington-based Microsoft were infringed.

“We remain as open as ever to extending a license to Barnes & Noble, and invite them to join the many other major device makers in paying for the Microsoft-developed intellectual property they use in their devices,” Howard said.

Barnes & Noble, based in New York, has complained to the U.S. Justice Department that Microsoft is trying to raise costs to drive out competition by “asserting trivial and outmoded patents against manufacturers of Android devices.”

According to Barnes & Noble’s filing in the case, through several meetings beginning in July 2010, Microsoft said its patents “were sufficient to dominate and entirely preclude the use of the Android operating system by the Nook.” An offer for a licensing agreement would have limited Barnes & Noble’s ability to upgrade its e-reader and set a rate that was higher than what it costs to license Microsoft’s own operating system.

Microsoft, in its response, said its actions were appropriate to enforce its patent rights.

The case is In the Matter of Certain Handheld Electronic Computing Devices, 337-769, U.S. International Trade Commission (Washington).

To contact the reporter on this story: Susan Decker in Washington at sdecker1@bloomberg.net

To contact the editor responsible for this story: Michael Shepard at mshepard7@bloomberg.net

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